Doing things right, but in the wrong way

In today’s spending review, George Osborne was absolutely right to hold the line on eliminating the structural deficit within one parliamentary term. In the Emergency Budget released earlier this year the coalition won fiscal credibility (and breathing space from international financial markets) by setting that goal. Failing to follow through on this goal at the first sign of difficulty would have damaged the government’s credibility and reputation in the eyes of international markets.
 
The Chancellor was also absolutely right to highlight the need for public service reform and to look to the welfare budget to provide some large and early savings. The government spends more on welfare than on anything else and savings in this budget can be made relatively quickly.
 
In spite of this there is still a nagging concern that the coalition is “doing the right things but in the wrong way”. A number of the key departmental budgets – health, schools, aid, science and pensions in effect – are still ring-fenced.